Section 51

Section 51 Hospital Assessment 2

Section 2TTTTT of said chapter 29, inserted by section 22 of chapter 126 of the acts of 2022, is hereby amended by striking out subsections (c) and (d) and inserting in place thereof the following 2 subsections:-

(c)(1) The secretary shall expend money in the fund, including all amounts credited to the fund, for payments to qualifying acute hospital providers under contract with the executive office of health and human services or under subcontracts with care organizations that contract with the executive office in connection with the MassHealth program as provided in this subsection.

(2) The secretary shall annually expend amounts from the fund averaging, for the 3-year period from October 1, 2024 to September 30, 2027, inclusive, not less than $2,158,500,000 per year; provided, however, that all such payments shall fall into 1 of the following categories: (i) health equity incentive payments; (ii) clinical quality incentive payments; (iii) other incentive payments; (iv) rate payments for services provided to MassHealth members; (v) targeted payments to: (A) freestanding pediatric acute hospitals; (B) nonprofit teaching acute hospitals that provide medical, surgical, emergency and obstetrical services and are affiliated with a state-owned medical school; (C) freestanding cancer hospitals; (D) the acute hospital that had the lowest statewide commercial relative price in fiscal year 2019 as reported by the center for health information and analysis; or (E) the independent group 1 safety net hospital that had the largest percentile of operating loss in fiscal year 2022 as reported by the center for health information and analysis. The secretary may determine funding allocations within each such category within a given year; provided, however, that such allocations shall be consistent with all approved federal waivers and state plan provisions; and provided further, that the secretary shall allocate an average of not less than $1,192,000,000 per year, for the 3-year period from October 1, 2024 to September 30, 2027, for the rate payments described in clause (iv), with an average of not less than $92,000,000 allocated for group 1 safety net hospitals for such 3-year period, an average of not less than $460,000,000 allocated for group 2 safety net hospitals for such 3-year period and an average of not less than $640,000,000 allocated across all acute hospitals for such 3-year period.

(3) Of the targeted payments described in clause (v) of the first sentence of paragraph (2), the secretary shall expend annually from the fund: (i) $70,000,000 to freestanding pediatric acute hospitals, of which at least 98 per cent shall be paid to the freestanding pediatric hospital that had the largest volume of inpatient discharges in fiscal year 2019; (ii) $35,000,000 to nonprofit teaching acute hospitals that provide medical, surgical, emergency and obstetrical services and are affiliated with a state-owned medical school; (iii) $11,000,000 to the acute hospital that had the lowest statewide commercial relative price in fiscal year 2019 as reported by the center for health information and analysis; (iv) $5,000,000 to freestanding cancer hospitals; and (v) $10,000,000 to the independent group 1 safety net hospital that had the largest operating percentile loss in fiscal year 2022 as reported by the center for health information and analysis.

(4) Of the incentive payments described in clauses (i) and (ii) of paragraph (2), the secretary shall make interim payments to qualifying hospitals based on the secretary's estimate of each such hospital's final payment for the measurement period. As soon as practicable after the close of the measurement period, the secretary shall determine the final amount of each qualifying hospital's incentive payments and shall reconcile each hospital's interim payment with its final payment.

(d) If any portion of the final annual amount allocated by the secretary to health equity incentive payments, clinical quality incentive payments or other incentive payments is unearned during the relevant measurement period for such payment, as determined by the secretary, the secretary shall transfer the state's share of that unearned amount to the Health Safety Net Trust Fund established in section 66 of chapter 118E.